It started the way successful businesses always start: with an idea. A common sense, easy-to-see yet tough-to-execute idea that called on every strand of our entrepreneurial DNA.
An idea that demanded we become smarter, more creative, more responsive and more fearless, even as we had to stay grounded and principled and good-humored enough to laugh at ourselves through the stress of each new, uncharted step.
An idea, in the end, that drove our original company’s transformation from a small niche single channel company into a national market leader that sold for more than half a billion dollars.
It is that narrative arc–that origin story–that now launches our newest venture, Coremix Capital. It’s what gives us the bottom-up, been-in-your-shoes (no matter what size) aspiration to guide companies through every phase of financing, innovation and growth.
As Kate Jones, Coremix Senior Managing Director, puts it, “We have the skill set that aligns with what everybody wants to do–build a successful business. We want to make somebody’s business bigger than it was yesterday. Other companies say they’ll find the talent to help you. Well, we have those people in-house – we are those people.”
“Business is an intricate, interlocking puzzle that needs constant solving.”
– Karen Holterhoff
the origin |
The company’s story began two decades ago, as husband-and-wife founders Marty Rifkin and Kate Jones were busy building Avid Health one small health food store at a time. In the insanely competitive business of dietary supplements, just keeping up with competitors was an exhausting, everyday challenge.Time, resources, customer demands—the juggling never stopped.
Then one day Kate noticed her 2-year-old daughter putting a toy in her mouth at a playgroup and then hand the toy off to one of her friends, who then also put the same toy in his mouth. Soon, it seemed as if every kid there had gummed the same toy.
Kate saw what any mother would see—germs. She tried to give her daughter a natural supplement used to bolster the immune system. Her daughter hated it: the stuff tasted terrible, which is the way stuff that was good for you was once supposed to taste.
Marty, meanwhile, saw what any entrepreneur would see—opportunity. A problem needed solving, and his solution was as profound as it was basic—make nutrition taste good. Simple as that! “Sometimes,” says Marty, Avid’s CIIO (Chief Imagination and Innovation Officer), “you can take a good idea and ruin it with complexity.” This simple solution to a basic consumer demand became the corporate philosophy and cornerstone of all further development.
Executing the idea of good taste was far more complicated, of course: research, testing, retesting, and then testing again. But to make a great idea a reality, the one indispensable requirement, along with passion, smarts and brutal self-appraisal, is the willingness to move quickly and stick with it.
“Growing up, my dad always told me, ‘he who hesitates is lost,’“recalls Kate. “We knew we had a great idea, so we didn’t hesitate. We put full resources behind the project.”
After many iterations they developed the winner: a vitamin supplement with the taste, shape and texture of a gummy bear.
Called L’il Critters®, the product line took over the children’s market and became the number one children’s vitamin in the country. Made with natural colors and flavors, it aligned with Kate and Marty’s core belief that they wouldn’t ask customers to give their children anything that they wouldn’t give their own. It was the kind of beyond-the-bottom-line integrity that eventually boosted their bottom line when it became a distinguishing part of the brand.
But Kate and Marty didn’t stop there. Openness to new ideas was now embedded in company culture. So when parents tasted their kids’ L’il Critters®, liked them, and then asked the company what dosage they should take, Avid Health pounced with another idea: VitafusionTM, a brand marketed to adults. It soon outsold the successful children’s line.
Avid Health eventually developed over 150 products within multiple brands. It grew, even in the recent recession, at annual rates of almost 40 percent.
Yet that head-spinning growth – the kind that struggling start-ups dream about – presented Kate and Marty with an entirely new set of challenges.
“A problem needed solving, and the solution was as profound as it was basic—make nutrition taste good.”
– Marty Rifkin
the growth |
They now had the challenge of marketing an escalating product line not only nationwide, but around the world, while still remaining nimble enough to keep up with retailers and customer demands and getting more and more products out the door. Soon the matter of size became a real issue. The company would now need a bigger factory. Who knew how to build a factory?
Kate and Marty were self-aware enough to bring in help where they needed it.
Karen Holterhoff came in to take on the operational side. She approached business as an intricate, interlocking puzzle that needed constant solving. She looked at the unknown as something to get intimate with. Building the new factory fell to her.
“It’s the notion of not letting traditional boundaries keep you from achieving what you know is possible,” explains Karen. “We undertook a multi-million dollar project knowing not one person in the room knew how to do it. But we knew if we dug in, we’d get it done.”
An additional 200,000-square-foot production and shipping plant doubled the company’s capacity and workforce, which grew from 200 employees in 2007 to more than 500 just three years later and 1,200 at the time of the sale.
Adhering to a mission statement that required a strong, positive impact on the community and on the environment, the factory was also energy efficient, employed low-impact manufacturing practices and used BPA-free bottles. The company avoided wasting human and intellectual capital by staying a step ahead of government regulations, rather than fighting them or devising work-arounds.
They also had to finance their expansion, maintain their cash flow, and negotiate with banks and private equity firms.
Strategically, Rick Falconer, a former Big Eight accountant was brought in because he saw numbers less as dictators than as storytellers and pathfinders. He viewed his role as helping to minimize risk rather than reign in creativity.
“When working with Avid, a rapidly growing business, I first sat down with them and we created a contingency plan,” explains Rick. “It is important to understand a company’s vision, discuss the possible risks involved with that vision, and come up with a plan that insures against them.”
“When I arrived at Avid Health the company was growing at over 40% a year, and what worked for Avid yesterday wasn’t going to work for them today. We identified potential problem areas and properly safeguarded against them so that the company could focus on critical everyday tasks and a new stage of development.”
“At Coremix Capital our job is to help minimize your risk, not reign in creativity. We are passionate about seeing your unique vision succeed.”
– Rick Falconer
the success |
And it was the development of a strong team and their ability to appropriately manage their transition during every stage of growth that made all the difference in Avid Healths’ success. In 2012, Avid Health, the little vitamin company that began in the health food channel in 1985, was bought out by a multi-billion-dollar NYSE company for over half a billion dollars. It is a success story that proves that to be successful you need to solve someone’s problem. Kate and Marty realized that children and adults did not enjoy traditional vitamin tablets — the gummy vitamin solved that problem and created a whole new delivery form. Next they developed a strong, smart and independent team that cultivated a culture based on impeccable customer service and a high level of respect for the end consumer.
Moving forward, these are the guiding principles that drive the force behind the team’s new business venture Coremix Capital: start with a great idea, commit to making it happen, assemble a strong team, and never lose sight of your dream along the way.
At Coremix Capital, Kate, Marty and the rest of their team take their love of business and their years of expertise and use it to help other companies navigate and translate their vision into a reality. By providing a combination of experience and financial resources, they are able to take your business to the next level.
“This is what makes our team so strong,” says Kate. “We have worked together for many years and we all have the same vision and passion for growing companies, whether it’s our own or someone else’s. Coremix Capital was founded based on the desire to help others do what we have already done.”
Simple as that.
“We have been in your shoes. We successfully turned our startup into a household brand, and now we are in the business of helping other entrepreneurs succeed. This is the driving force behind Coremix Capital.”
– Kate Jones